THE HUB FOR CANADA’S LEADING PROGRESSIVE VOICES.

I don’t know whether it’s smugness or indifference, but we Canadians can be a self-deluding lot. Growing inequality, portrayed recently in The Economist as a global scourge, when viewed from Canada, seems to be a problem only for others.

After all, it was other countries’ banks that crashed in 2008. It’s in southern Europe that tens of thousands are taking to the streets. And it was in France and the United States that recent elections were fought over the fact that those who created the mess, the top 1 per cent, are still getting big bonuses and low tax rates.

"The ideas of economists and political philosophers … are more powerful than is commonly understood. Indeed the world is ruled by little else. Practical men who believe themselves to be quite exempt from any intellectual influences, are usually the slaves of some defunct economist." - John Maynard Keynes, The General Theory of Employment Interest and Money (1936)

In economics, hope and faith coexist with great scientific pretension and also a deep desire for respectability. - J.K.Galbraith, New York Times Magazine (June 1970)

The policy community praises the ideal of “evidence-based” policy – policy with a solid research base. In the real world, however, we all know that public policies, as implemented, are more often than not only vaguely related to research results and the best available data.

This is the first section of a three-part commentary by Sheila Block on our Equality Project report. Stay tuned over the coming weeks as we release parts two and three.

The Broadbent Institute paper provides an overview of the complex range of causes of Canada’s increased income inequality. They range from changes in how economic activity is organized and located internationally to domestic policy decisions. Some, like changes in patterns of international trade and production or technological change, can make the problem seem very large and intractable. That is why it is particularly important to identify those government policies that have contributed to increased inequality. These policies that concentrated wealth and power in the hands of the few to the detriment of the many were not inevitable. The politicians who implemented them made choices, and those choices can be reversed. Reversing these policy decisions is an important step to addressing inequality in Canada.

Inequality seems to be the watchword of the moment in Fall 2012. It is on the minds of many, it seems, sometimes forming on surprising lips. Lloyd Blankfein, the CEO of Goldman Sachs, had this to say in a mid-September talk in Toronto to financiers, bankers, executives and lawyers: “In the U.S. over the last generation, we have been much better at generating wealth and much less good at distributing it." President Obama mentioned inequality in his acceptance speech at the Democratic National Convention, as did others who spoke there, notably Elizabeth Warren, then a Harvard Law Professor, now a U.S. Senator for Massachusetts, and co-author of the 2000 book The Fragile Middle Class. And the recent report of the World Economic Forum, The Global Competitiveness Report 2012-2013 focuses on the fundamental importance of social and environmental sustainability (including efforts to diminish social inequalities) to any country’s global competitiveness.

It is uncertain which is more puzzling: the sudden surge in inequality in developed countries in recent times, or the failure of this to generate a sufficient response in the form of a countervailing politics.

Personally, I have never been very good at them... which made me think: why not get a 47-day head start?

You can bet that a more progressive and equal Canada will be at the top of our resolutions in 2013, but why not get the ball rolling now? I’d like to share with you a special chance for you to play an important role for the next cohort of Canadian change leaders.

When Red Tories hear that union leaders, trade union economists, academics and thoughtful politicians of the left (and Red Tories believe there are many) are planning to engage and advocate on the issue of inequality, we have cause to worry a little. We worry because their focus is often on legislating outcomes that must be glaringly and unabashedly equal. We also worry about polemicists on the far right who argue that most unequal outcomes happen because the winners worked harder, took more risks, had more skill and well, that's how freedom and free markets are supposed to work, even though many of the winners were winners because their parents were or because they were at the right place at the right time. Both biases are deeply unhelpful to finding genuine solutions to inequality.

In 2008, the collapse of financial markets around the world tipped country after country into recession. Canada was no exception. In a short eight month period, hundreds of thousands of Canadians lost their jobs and the Employment Insurance and Social Assistance rolls started to climb. The proportion of part-time and temporary jobs increased as full-time employment disappeared. Canadians had to stretch their dollars further to pay for rising food costs and shelter, many turning to food banks – and credit cards – to make ends meet.

Canadians can sometimes be smug. We pride ourselves on our supposed modesty, but we never miss a chance to stress all the ways in which we are better than our American neighbour. We have a universal public health care system. They don't. Our public school system performs much better than theirs. And, on a number of indicators, from child mortality to the rate of poverty of the elderly, we appear to be a more just society.

When it comes to income inequality in Canada though, there is nothing to be proud of. Over the last fifteen years, Canada has had one of the greatest increases in inequality amongst OECD countries. Inequality is not just an American problem.

The Finance Department’s long-awaited study on the economic and fiscal implications of our aging population was finally released on Oct. 23. It’s a gloomy outlook that underpins the Harper government’s view that we have to cut government spending today to maintain costly social programs tomorrow.

What the report fails to look at is the positive impacts of slower growth in the labour force, namely the prospect of better jobs and higher productivity.